BISHOPS, Tory grandees, disabled campaigners, and Opposition peers have voted to block the Chancellor’s tax-credit changes for three years, pending a consultation.
In a historic move, the House of Lords defeated George Osborne’s plans to cut tax credits for working families, by 289 votes to 272, on Monday. It was the first time in 100 years that a finanical proposal from MPs in the Commons has been voted down by the Lords. A Liberal Democrat motion to “kill” the changes was rejected.
The Bishop of Portsmouth, the Rt Revd Christopher Foster — who tabled a “motion of regret” on Thursday of last week — said that he was “appalled” by the proposals, which would cut the income threshold for Working Tax Credits from £6420 to £3850 a year from April.
Those claiming Child Tax Credit would have seen the threshold reduced from £16,105 to £12,125. The taper rate — the rate at which payments are reduced — was to have increased from 41p to 48p for every £1 earned. Bishop Foster said that the plans were “morally indefensible” to working parents.
His amendment, which urged Mr Osborne to consider the “short-term impact” of the plans, does not prevent their approval. Victory for the Labour and Crossbench motions will, however, force the Government to pause over the reforms, and to respond to criticism.
In the Lords debate, the Archbishop of York, Dr Sentamu, suggested that the “unintended consquences” of the cuts could put poor families “in the hands of loan sharks”.
The Bishop of Gloucester, the Rt Revd Rachel Treweek, who on the same day became the first female bishop to sit in the Lords, said that she wanted the Government to “hear loud and clear” the Bishops’ concern for working families: “We don’t want people to be worse off.”
The chairman of Christians in Parliament, Gary Streeter, a Conservative, said that, although he supported the need to control the £30-billion tax-credit bill, “this must be done at a pace people can afford.”
Mr Osborne said on Monday that, despite his defeat, he believed that the Government could “achieve the same goal”. He promised that reforms would be “modified” before the Autumn Statement next month, and said that the Government would provide “transitional help”.
Speaking on Tuesday, Bishop Foster said he was pleased that the Chancellor showed willingness to review the proposals. “I hope the Government’s review will address the mismatch between the very welcome but phased increase in the Minimum Wage — leading to the new, national Living Wage — and the one-off hit of the tax-credit cut due next year.”
The director of policy and research at the Children’s Society, Sam Royston, also welcomed the delay to child tax-credit cuts. These would “damage children’s lives, as well as undermine incentives for parents to move into work or earn more”.
The chief executive of the Christian charity, Care, Nola Leach, described the “unusual step” to block the reforms as a victory for working families.
Answering questions on Tuesday, the Chancellor criticised the “unelected” Labour and Liberal Democrat Lords for opposing an elected House of Commons.
Mr Cameron said last week that if the amendments were passed, he was ready to fill the Lords with Conservatives. On Tuesday, he announced a “rapid review” of Parliament’s workings, and appointed the former cabinet minister Lord Strathclyde to see that MPs would have the “decisive role” in financial plans.
Churches urge DWP to refocus benefits
A GROUP of Churches and charities have openly criticised the Government’s response to the latest report on the welfare system because it fails to make a commitment to a “full review” of benefit sanctions.
In a joint statement on Thursday of last week, the Church in Wales, together with the Church of Scotland, Methodist Church, United Reformed Church, Baptist Union, and the charity Church Action on Poverty, said that the policy changes outlined by the Department for Work and Pensions (DWP) are “not enough”, and called for a full independent review of the system.
The report by the Work and Pensions Select Committee Welfare to Work, published on Wednesday of last week, urged the DWP to refocus its Work Programme — which provides benefits, work experience, and training for the unemployed — and Work Choice (for the disabled) on securing jobs for the disadvantaged, before the contracts are replaced in 2017 (News, 23 October). The Committee urged the Government to refocus its support on the unemployed who are challenged by addiction, homelessness, or illiteracy.
The Churches and charities are in agreement with the Committee, along with government advisers, and the Social Security Advisory Committee, in calling for the immediate suspension of sanctions against families with children and people with mental-health issues.
The public issues policy adviser for the Methodist Church, Paul Morrison, said that the DWP was “stubbornly ignoring” these groups, and the “inhumanity” of the current “regime”, by refusing to undertake a comprehensive review.
He said that the Government’s proposed “warning system” would not address the “fundamental problems” that occur before the decision to sanction is taken. “If a court is working to a bad set of laws for a bad set of reasons and making bad and unreliable decisions, it’s not the sentencing policy you look at,” he said. “Any system that seeks to ‘change people’s behaviour’ by using hunger as a weapon is immoral.”
The chairman of the committee, Frank Field MP, welcomed the introduction of the Government’s “yellow-card” system, but said that the response “leaves a number of questions unanswered”. He said: “We will be tracking the progress closely to ensure that the Government follows through on the spirit of this . . . response in practice.”
The latest criticism comes after the same group of Churches and charities published a joint report in March, Time to Rethink Benefit Sanctions, which stated that seven million weeks’ worth of benefit cuts had been made in sanctions in 2013/14 (News, 27 March). The research also suggested that near to 100,000 children had been affected by sanctions in 2014, and that people with mental-health issues were being penalised at a rate of more than 100 per day.
The deputy chairman of the British Medical Association’s General Practitioners Committee, Dr Richard Vautrey, said that the number of people suffering “serious” physical and mental-health problems as a result of benefit sanctions was on the increase.